John Kapoor Net Worth

What is John Kapoor's Net Worth?

John Kapoor is an American entrepreneur who has a net worth of $50 million. At his peak in 2017, with his company's stock price soaring, John Kapoor's net worth was just under $2 billion. In October 2017 John was arrested on RICO and wire fraud charges. He found guilty on all charges and served 2.5 years in prison. In 2019, his company filed for bankruptcy. John Kapoor was played by Andy Garcia in the 2023 Netflix Crime/Drama Pain Hustlers starring Emily Blunt and Chris Evans.

Early Life

John Nath Kapoor was born in 1942 in Amritsar, Punjab, India into a humble backround. He later moved to Mumbai where he graduated from the Institute of Chemical Technology (formerly UDCT) with a degree in pharmacy. His academic pursuits later led him to the United States where he attended the University at Buffalo on a scholarship and obtained a doctorate in medicinal chemistry in 1972.

Career

With a fresh Ph.D. in hand, Kapoor plunged into the job market. He started out in operations at a small drug company in Grand Island, New York called Invenex Pharmaceutical. Soon afterwards Kapoor approached the senior execs at Stone Container, a cardboard box manufacturer, with a bold proposition: let him run Lypho-Med, their neglected generic drug subsidiary in Chicago. Despite a warning that Stone Container intended to sell the drug business he confidently negotiated for a job as General Manager and the right of first refusal for when the company would go up for sale.

Kapoor bought Lypho-Med for a steal thanks to a loan from a Chicago-based bank, a small personal investment of around $50,000 and capital from some investors. He became the bossman and took the company public, steering the whole operation. He then changed the company's name to Lyphomed and expanded the business into selling hundreds of injectable medications to hospitals.

The 1980s were a golden age for generic drug companies as a bunch of big-name drugs were going off-patent. Kapoor turned into a vulture constantly circling the pharmaceutical giants, waiting to swoop in with a cheaper, generic copy of their branded products once they went off-patent. He was so relentless that his generic drugs would hit the market at midnight on the very day a patent expired in order to beat the flock of competitors to the market.

Within a decade Lyphomed grew from 20 to around 800 employees and sales skyrocketed to 25 times their original figure. The 1980s brought even more opportunities for the company. As the AIDS epidemic ravaged communities Lyphomed held a near monopoly on pentamidine, an antibiotic used to treat deadly pneumonia infections in AIDS patients.

In 1989 Kapoor sold Lyphomed to the Japanese company Fujisawa for nearly $1 billion. His cut from the sale was $130 million—a massive return on his tiny initial investment. He re-invested his wealth into dozens of startups and acquired significant stakes in larger enterprises. He became the biggest shareholder in at least five biotech firms, including Akorn, First Horizon, and Neopharm most of which dealt in generic drugs.

Insys Therapeutics

In 2002 Kapoor teamed up with fellow Indian-born immigrant George Kottayil to launch Insys Therapeutics. The ever-savvy Kapoor put up a $1 million stake for three-quarters of the company while Kottayil became the president, overseeing the development of potential new drugs. Kottayil parted ways with Insys in 2008 to become executive vice president at Revogenex. Later on in 2014 he co-founded and became the CEO of Grace Therapeutics, a private company dedicated to developing drug delivery systems for rare diseases.

Despite losing its trusted president, Insys didn't just survive—it thrived. The company successfully developed and secured FDA approval for Subsys (a branded version of fentanyl). Fent was present back then but Kapoor's innovative method of delivering it through an under-the-tongue spray changed the way doctors administered it. Most of them lauded this approach claiming it allowed the drug to work as IV medication resulting in rapid pain relief for cancer patients and an improved quality of life.

Since Subsys cost several thousand dollars a month, far exceeding the $20 price tag of generic opioid pills typically sold by Insys, the young hustler from the streets of Mumbai knew he had hit the jackpot. Kapoor listed Insys as a public company in 2013 and the stock rose five times over the course of the year. In 2015 the company raked in $331 million in sales with operating profits hitting $92 million, marking a 28% profit margin. Kapoor's wealth grew massively bolstered by investments from his other companies.

Legal Issues

In 2017 Kapoor was arrested and charged with RICO conspiracy, conspiracy to commit wire fraud and conspiracy to violate the Anti-Kickback Law. He was allegedly bribing doctors to prescribe Subsys to their patients. Further allegations emerged accusing him of planning to defraud health insurance companies. Subsequently, Kapoor decided to resign from his position at Insys.

On May 2, 2019 Kapoor was found guilty of involvement in a racketeering conspiracy to increase Subsys' profits and was consequently sentenced to 5.5 years in prison the following year. He tried appealing but the court upheld both his convictions and the sentence. Once the impact of COVID-19 had reduced, he was locked up at Duluth FPC. After completing two years of his original sentence he was released in June 2023.

Personal Life

John Kapoor has four children. He established the John and Editha Kapoor Charitable Foundation in memory of his beloved wife Editha who succumbed to breast cancer. This foundation is dedicated to supporting the fight against cancer.

The University at Buffalo School of Pharmacy and Pharmaceutical Sciences named its building John and Editha Kapoor Hall in honor of Kapoor and his late wife after his generous donation to the school. However, the university decided to remove his name from the building following his RICO conviction.